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Obamacare rates in Illinois could climb next year

“Health insurers want to raise premiums next year for Illinois consumers who buy coverage through the Obamacare exchange — in many cases citing uncertainty surrounding the health care law as a reason for the proposed jumps.

Average rate increases for individual plans in Illinois could range from 5 percent to 43 percent depending on a number of factors, including the type of coverage, a consumer’s age and whether the person is a smoker. The proposed rate changes released Tuesday are the result of a complex series of calculations made by insurers and will likely be finalized in coming months.

The outcome of the rate-setting process has ramifications for a wide swath of the state’s population. Although most people in Illinois get coverage through employers or government programs such as Medicaid and Medicare, this year more than 350,000 Illinois residents enrolled in exchange plans.

All three of the insurers that offered plans on the exchange in Cook County this year are proposing increases for next year.

Blue Cross and Blue Shield of Illinois is proposing average increases of 38.2 percent for its BlueCare Direct HMO plans, 14.5 percent in its Blue Precision HMO plans, 9.3 percent in its Blue FocusCare HMO plans and 5.4 percent for its Blue Choice Preferred PPO plans.

In all, those plans cover nearly 310,000 people in Illinois.

The insurer cited, among other issues, increasing medical and prescription drug costs as reasons for the proposed increases. This year, Blue Cross was the only insurer to offer PPO plans on the exchange and offered coverage statewide.

“In order for us to be able to offer viable products for consumers in a responsible, sustainable way, our rates must be actuarially sound,” said Blue Cross and Blue Shield of Illinois spokeswoman Erika Callahan, in an email Tuesday. “That requires us to account for the real risks and considerations that currently exist in our markets.”

Cigna, which also offered plans in Cook County this year, is proposing an average 37.7 percent increase, citing the increasing costs of medical and pharmacy services and supplies. Nearly 27,000 people in Illinois could be affected by that increase.

Celtic Insurance Co., another provider of plans in Cook County this year, is proposing increases of more than 15 percent next year. At least 36,000 people in Illinois could be affected by Celtic’s increases.

Health Alliance Medical Plans, which offered plans mostly in central and southern Illinois this year, is proposing rate increases of as much as 43 percent for individual plans next year.

Illinois Department of Insurance Director Jennifer Hammer said in a statement Tuesday that the good news for Illinois is many consumers will see smaller average increases than last year, and that consumers in every county in the state will have access to an exchange plan.

But she also warned: “There is no question that major structural flaws in the (Affordable Care Act) have forced higher insurance rates and separated families from trusted physicians and hospitals. … We continue to strive to provide a robust insurance market, but without changes to our health care system, consumers may be faced with more hardship in the future.”

The Senate failed last week to pass a bill to repeal or replace the health care law, but there are still actions the Trump administration could take, without congressional approval, to weaken the law. It’s also possible that Congress could try again to change the law.

Blue Cross, Cigna and Health Alliance said in their rate filings that they based their proposed increases partly on that continuing uncertainty.

Health Alliance and Blue Cross, when deciding their rates, took into account uncertainty about the future of the current requirement that everyone buy insurance or pay a penalty. Though that requirement remains in place for now, questions remain about how strictly the Trump administration will enforce it.

Health Alliance and Blue Cross also considered the unknown fate of subsidies now paid to insurers meant to offset the expenses of reducing deductible and copay costs for lower-income plan members. Cigna based its proposed increase on the assumption that those subsidies would disappear.

“Health plans must plan for the possibility (of) the individual mandate and/or federal subsidies going away,” said Laura Mabry, a spokeswoman for Health Alliance, in an email Tuesday.

President Donald Trump already has threatened to end the subsidies — known as cost sharing reduction payments — to insurers. Over the weekend, Trump tweeted, “If a new HealthCare Bill is not approved quickly, BAILOUTS for Insurance Companies … will end very soon!”

Obamacare proponents have referred to the effects of such uncertainty on rates as the “Trump tax,” while opponents point out that premiums on exchange plans have been rising for years, since before Trump took office.

This year, Blue Cross raised premiums for individual exchange plans in Illinois by 43 to 60 percent. For next year, many insurers across the country have, like those in Illinois, proposed increases in the double digits.

Stephani Becker, a senior policy specialist at the Sargent Shriver National Center on Poverty Law, said it’s positive news that a number of insurers remain on the Illinois exchange. Four of the five insurers that offered plans on the Illinois exchange this year filed proposed rates again for next year. Humana will no longer offer individual exchange plans in Illinois or anywhere else in the country, as it announced in February.

Some states had only one insurer on their exchanges this year. This year, only one, Blue Cross, offered individual exchange plans in Lake and McHenry counties.

“It shows that there is potential to be competitive in the counties and that is great, and sort of goes against the narrative that the Affordable Care Act is failing,” Becker said of the remaining insurers in Illinois.

She said, however, that some of the highest proposed rate increases are “alarming.” She noted that many people get tax credits that will help offset those increases. But those who don’t will feel the full weight of those higher rates.

Dan Schiller, a freelance attorney in Chicago who’s been buying plans on the exchange for years, said Tuesday “the rate increases scare me.”

But he doesn’t want to see the Affordable Care Act vanish either. Many people have gained insurance through the health care law, he said, and he’s confident he’ll still be able to find a plan that will fit his needs, even with the increases.

“I think there are a lot of success stories of the Affordable Care Act that are not being told,” Schiller said.
The proposed rates released by insurers Tuesday are preliminary and still could be changed in coming days. Also they don’t take into account the tax credits many individuals get to offset the costs of their premiums.

Illinois is what’s known as a “file and use” state, meaning the state doesn’t have the power to change or reject insurers’ proposed rates, though it can negotiate in hopes of persuading insurers to come down.

In most cases, final rates did not come down from proposed rates for individual exchange plans this year.

Open enrollment for exchange plans will begin Nov. 1 and run through Dec. 15.

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2015 Open Enrollment

Here are 4 key dates you should know:

• November 15, 2014. Open Enrollment begins. Apply for, keep, or change your coverage.
• December 15, 2014. Enroll by the 15th if you want new coverage that begins on January 1, 2015. If your plan is changing or you want to change plans, enroll by the 15th to avoid a lapse in coverage.
• December 31, 2014. Coverage ends for 2014 plans. Coverage for 2015 plans can start as soon as January 1st.
• February 15, 2015. This is the last day you can apply for 2015 coverage before the end of Open Enrollment.